|
2023-TIOL-1022-HC-DEL-GST
Cube Highways And Transportation Assets Advisor Pvt Ltd Vs Asstt. CCGST Division
GST - Section 54 of the Act, 2017 - Petitioner was denied refund of ITC on, essentially, three grounds - First, that the petitioner is an 'Intermediary' in respect of the services provided by it to I-Squared, in terms of Sub-section (13) of Section 2 of the IGST Act; therefore, in terms of Sub-section (8)(b) of Section 13 of the IGST Act, the place of supply of service is in India, as the petitioner is located in India - Consequently, the services rendered by the petitioner did not qualify as export of services under Sub-section (6) of Section 2 of the IGST Act - Second, that the place of supply of services provided by the petitioner was in India by virtue of Sub-section (3)(b) of Section 13 of the IGST Act and third, that the place of supply of services provided by the petitioner was in India by virtue of Sub-section (4) of Section 13 of the IGST Act -Adjudicating Authority concluded that the petitioner was rendering 'Intermediary Services' -According to Appellate Authority, Sub-section (3)(b) and Sub-section (4) of Section 13 of the IGST Act would be applicable to the petitioner's case and the place of supply of services by the petitioner is in India - Aggrieved, the petitioner is before the High Court.
Held: The petitioner is the service provider - It is rendering the advisory services directly to I-Squared and is not acting as a facilitator for providing such services -It is implicit in the concept of an 'Intermediary' that there are three parties, namely, the supplier of principal service; the recipient of the principal service and an intermediary facilitating or arranging the said supply - Where a party renders advisory or consultancy services on its own account and does not merely arrange it from another supplier or facilitate such supply, there are only two entities, namely, service provider and the service recipient - In such a case, rendering of consultancy services cannot be considered as 'Intermediary Services' or services as an 'Intermediary' -As is apparent from the plain language of Sub-section (4) of Section 13 of the IGST Act, the supply of services contemplated under the said Clause are those that are supplied directly in relation to an immovable property -In the present case, the petitioner is rendering advisory services to I-Squared - The petitioner had repeatedly filed submissions before the authorities (Adjudicating Authority as well as Appellate Authority) explaining that it is rendering "advisory services to overseas group companies with respect to investment avenues in transportation sector after performing its own analysis and due diligence" - It had also explained that its overseas group company [I-Squared] is not bound by its advices and takes its own decision at its discretion as expressly stated in the Agreement -The petitioner had also provided invoices which indicated that it was charging "market services and advisory fee" - There is no material which would even remotely suggest that the services rendered by the petitioner are not as claimed, that is, advisory services relating to investments in India - As noticed, the authorities concernedhad also accepted the same as is apparent from some of the observations made in the impugned order - Neither the Adjudicating Authority nor the Appellate Authority had any material to doubt the petitioner's claim that it had rendered advisory services for making investments in India - Bench does not consider it apposite to remand the present petitions for fresh adjudication -The impugned orders are set aside - The Adjudicating Authority is directed to process the petitioner's claim for refund as expeditiously as possible and preferably with in a period of eight weeks - Petitions allowed: High Court[para 40, 42, 55, 57, 58]
- Petitions allowed: DELHI HIGH COURT
2023-TIOL-1021-HC-PATNA-GST
Aastha Enterprises Vs State of Bihar
GST - Issue raised is as to the sustainable claim of Input Tax Credit, when it has been proved that the purchaser, a registered dealer has satisfied the tax liability to the selling dealer, another registered dealer, evidenced by a tax invoice; even when the selling dealer does not pay the said tax to the Government after collecting it from the purchaser - Whether the purchasing dealer can be denied Input Tax Credit evidenced by the invoice and is not the State obliged to take proceedings against the selling dealer, who defaulted payment of collected tax to the State; for which the statute provides ample scope, is the question raised.
Held: Conditions for enabling such benefit, are available in Clauses (a) (b) and (c) of s.16 of the Act, 2017, which are in seriatim; the existence of a tax invoice or debit note issued by the supplier, proof of receipt of goods or services or both and the tax charged in respect of such supply having been actually paid to the Government, either in cash or through utilization of Input Tax Credit admissible in respect of the said supply - The said conditions are to be satisfied together and not separately or in isolation, and these are the conditions and restrictions which would regulate the availment of Input Tax Credit - Input Tax Credit, by the very nomenclature, contemplates a credit being available for the purchasing dealer in its credit ledger by way of payment of tax by the supplier to the Government - Taxation as has been held is a compulsory extraction made for the purpose of public good, by the welfare State and without the levy being paid to the Government; there can be no claim raised of the liability to tax having been satisfied and hence there is no question of double taxation -The mere fact that there is a mode of recovery provided under the statute would not absolve the liability of the taxpayer to satisfy the entire liability to the Government - The purchasing dealer being the person who claims Input Tax Credit could only claim the Input Tax benefit if the supplier who collected the tax from the purchaser has paid it to the Government and not otherwise - The Government definitely could use its machinery to recover the amounts from the selling dealer and if such amounts are recovered at a later point of time, the purchasing dealer who paid the tax to its supplier could possibly seek for refund - However, as long as the tax paid by the purchaser to the supplier, is not paid up to the Government by the supplier; the purchaser cannot raise a claim of Input Tax Credit under the statute- The word 'Input Tax Credit' itself postulates a situation where the purchasing dealer has a credit in the ledger account maintained by it with the Government - The said credit can only arise when the supplier pays up the tax collected from the purchaser - The mere production of a tax invoice, establishment of the movement of goods and receipt of the same and the consideration having been paid through bank accounts would not enable the Input Tax Credit; unless the credit is available in the ledger account of the purchasing dealer who is an assessee - The statutory levy and the further benefit of Input Tax Credit conferred on the purchasing dealer depends not only upon the collection by the seller but also the due payment by the seller to the Government - When the supplier fails to comply with the statutory requirement, the purchasing dealer cannot, without credit in his account claim Input Tax Credit and the remedy available to the purchasing dealer is only to proceed for recovery against the seller - It is clear that the literal nomenclature and the statutory language, mandates that there should be credit available in the credit ledger of the purchaser to claim Input Tax and otherwise the claim would be frustrated - On the above reasoning, Bench finds that the claim of Input Tax Credit raised by the petitioner cannot be sustained when the supplying/selling dealer has not paid up the amounts to the Government; despite collection of tax from the purchasing dealer - Writ petition is dismissed: High Court [para 8, 12, 13, 14, 15]
- Petition dismissed: PATNA HIGH COURT
2023-TIOL-1020-HC-DEL-CUS
Nidhi Kapoor Vs Pr. Commissioner And Addl. Secretary to the Govt. of India
Cus - Issues are whether bringing of gold into India falls within the ambit of a 'prohibited' article under section 2(33) read with Section 11 of the Act, and if so, to what legal effect as to its release/redemption on payment of fine/penalty under section 125 besides 112 and 114 of the Act; and at the same time as to whether bringing of gold into India without declaring it on arrival at Customs amounts to "smuggling" of gold into India in violation of Section 2(39) read with Section 111 of the Act and/or under any other analogous statutes inviting not only confiscation of the gold but also action in the nature of imposition of levy of fine/penalty.
Held:
+ There is no gainsaying that as per Section 123 of the Act, the burden of proving that the goods are not smuggled' goods is placed upon the person from whom the goods are seized or the person who claims to be owner.
+ Smuggling of gold into India causes a cascading effect on the economy of the country, and Bench cannot overlook the fact that smuggling of gold into India is obviously preceded by payment of consideration either in Indian or foreign currency, which is another aspect of alarming levels of actionable money laundering, venturing into generation of black money and other unlawful activities including financing terrorism.
+ Plea that another passenger on the same day was apprehended with huge commercial quantity of gold, namely, Ridhima Bajaj but let off by the Custom Authorities inasmuch as release/redemption was allowed, is hardly of any legal consequence. By all means it is manifest that such decision was contrary to the law but then one bad precedent does not legally entitle the petitioner to claim similar benefit.
+ The plea of the petitioner that she had been gifted the gold items of such huge quantity weighing about 3100 grams was considered and it was held that deed was neither bearing any acceptance nor had any legal sanctity.
+ The plea advanced on behalf of the petitioner that another passenger, namely Vinay Gupta carrying almost the same quantity of gold was let off by the Customs Authority cuts no ice since it was a precedent not worth its salt. Two wrong precedents cannot create a right. Revisional Authority was, therefore, correct on facts and law to hold that the claim of the petitioner in gold items weighing about 3000 grams was dubious and the documents with regard to ownership were found to be plainly fabricated.
+ Union Government stood empowered to prohibit the export of all or any goods including a class of goods specified in a notification issued in that respect, unless the exporter had furnished to the prescribed authority a declaration in terms as contemplated in that provision. Section 18 of FERA is thus structurally clearly distinct and distinguishable from the regime of prohibited goods which stands embodied in Section 2(33) of the Act. In fact, FERA did not even incorporate a defining provision for prohibited goods.
+ The Circular of CBEC dated 10 May 1993 takes note of the fact that while gold may not be included in the list of prohibited items in the import policy, its import clearly fell in the restricted category of goods. It also took note of the restriction of its import being allowed only against a license and in accordance with any public notice that may have been issued.
+ Section 2(33) of the Act defines "prohibited goods" to mean any goods the import or export of which is subject to any prohibition under the Act or any other law for the time being in force. It, however, significantly proceeds to exclude goods which have come to be imported or exported in compliance with the conditions which apply. The exclusion of imported or exported articles and transactions which have been completed subject to due compliance with the conditions prescribed are clearly excluded from the ambit of prohibited goods by virtue of the usage of the phrase "but does not include…".
+ The expression "prohibited goods" as used in Section 2(33) and the concept of "prohibition" must, therefore, and necessarily draw colour and meaning from the specific exclusion of goods which have come to be imported or exported upon due compliance with the conditions prescribed. If compliance with conditions for import or export were irrelevant and the expression prohibition were to be understood in absolute terms, there clearly does not appear to be any justification for the definition clause to also deal with those goods which enter the territory of India after complying with the various conditions for import that may have been prescribed. In our considered opinion, this is the first aspect which appears to indicate that the word "prohibition" is intended to also extend to a restriction or regulation under the Act.
+ Section 11 comprises the power to prohibit importation or exportation of goods. The provision empowers the Union Government to prohibit the import or export of goods of any specified description "either absolutely or subject to such conditions (to be fulfilled before or after clearance)…..". The language of the provision thus clearly indicates that a prohibition in respect of import may be either absolute or be subject to the fulfilment of such conditions as may be prescribed.
+ Section 111 of Customs Act, apart from speaking of dutiable or prohibited goods also brings within its net, goods which have come to be imported either in violation of conditions prescribed or goods which have been concealed as well as imported articles which may have otherwise not complied with the conditions prescribed under the Act.
+ Section 2(33) of the Act while defining prohibited goods firstly brings within its dragnet all goods in respect of which a prohibitory notification or order may have been issued. That order could be one promulgated either under Section 11 of the Act, Section 3(2) of the FTDR or any other law for the time being in force. However, a reading of the latter part of Section 2(33) clearly leads us to conclude that goods which have been imported in violation of a condition for import would also fall within its ambit. If Section 2(33) were envisaged to extend only to goods the import of which were explicitly proscribed alone, there would have been no occasion for the authors of the statute to have spoken of goods imported in compliance with import conditions falling outside the scope of "prohibited goods".
+ Court holds that an infraction of a condition for import of goods would also fall within the ambit of Section 2(33) of the Act and thus their redemption and release would become subject to the discretionary power of the Adjudging Officer. Court finds no illegality in the individual orders passed by the Adjudging Officer and which were impugned in these writ petitions. [para 69, 73, 74, 77, 92, 123, 134, 135, 136, 145, 156]
- Petitions dismissed: DELHI HIGH COURT
2023-TIOL-1019-HC-DEL-CUS
Disha Langan Vs DRI
Cus - Allegation of smuggling of arms and ammunitions from Slovenia to Indiaunder the garb of holder of 'Renowned Shooter' Certificates granted by the NRAI and that they were selling the said smuggled weapons of foreign origin in India on huge profits and using them for hunting wildlife animals- Petition has been filed seeking quashing of the Criminal Complaint filed by the respondent/Directorate of Revenue Intelligenceand for quashing of the order dated 22.10.2018 passed by the Chief Metropolitan Magistrate - Petitioner submits that on the date of incident i.e., 29.04.2017, she was not in Delhi and was at Gujarat National Law University, Gandhinagar, Gujarat [where she was studying at that point of time]; that she never ordered any import of arms as it was her father who procures them on her behalf; that as she was only concerned with the shooting competitions, and all arrangements qua the arms and their procurement were made by her father, she was also not aware of the quantum of arms in her name as all the paperwork was handled by her father; that the petitioner cannot be punished for the alleged offences committed by her father and also that based on the documentary evidence, including the statement of the petitioner recorded under Section 108 of the Act on 20.06.2017, there is no case made out against her - Counsel for Revenue submitted that since the petitioner allowed her father to use her license, she had knowledge of the fact that her father was wrongly importing arms and there is reason to believe so.
Held : Remedy of revision being available cannot itself be construed to bar the jurisdiction of this Court in terms of Section 482 Cr.P.C - Petition in the present form is maintainable as there is no absolute bar thereof in the eyes of law - The petitioner herein has been named in the said complaint on the basis that at the time of seizure from the father of the petitioner, the 'Renowned Shooter' Certificate of the petitioner was found in his possession, which was allegedly utilized to procure and purchase arms from Slovenia -It is not in dispute that on the date of incident i.e., 29.04.2017, the petitioner, besides being enrolled in LLB course at Gujarat National Law University, Gandhinagar, Gujarat was also a National level shooter - It is also not in dispute that on the date of incident, the petitioner was not present in Delhi as she was in Gandhinagar, Gujarat - It is the primary case of the petitioner that no case has been made out against her as she has no connection whatsoever with the commission of the alleged offences; thatshe bonafidely gave her license to her father as he had always been responsible for procuring the necessary arms and ammunitions for her- It is a matter of common knowledge that most of such students are dependent upon their parents - This is more so when the parents are also involved in the same activity, like in the present circumstances, where the father of the petitioner is himself a shooter - Considering the state of affairs involved, this Court is of the view that like any other student, the petitioner would have been busy in her studies and like any other sportsperson, she would also have been busy with her shooting practices and, therefore, her father filled in for making all arrangements qua procuring arms and ammunitions for her shooting practices/ competitions - Statement of the petitioner in the present scenario is very much plausible and reposes confidence for this Court to opine that she never ordered any import of arms herself and that her father, being a renowned shooter himself, was responsible for procuring them for her, and that she was unaware of the alleged offences committed by her father - None of the ingredients of Section 135 of the Act are prima facie fulfilled and no case has been made out against the petitioner - Court is of the view that the case against the petitioner is based on assumptions and presumptions, which is neither sufficient for registration of a complaint against her nor for issuance of the impugned summoning order - Petitioner is being wrongly prosecuted for the alleged offences committed by her father, only on the pretext that her father was in possession of her License at the time of seizure and had allegedly utilized the same for procuring arms, without any specific allegation(s) against her - Even the report of the DRI seeking sanction for prosecution, holds that the petitioner had no direct connection in the commission of the alleged offences - It is difficult for this Court to conclude that the petitioner had any knowledge of the alleged offences committed by her father which can be attributable to her - Petitioner cannot be punished for the alleged offences committed by her father as there is no concept of vicarious liability under Criminal Law - The same being impermissible in law, the issuance of summons to the petitioner by the Chief Metropolitan Magistrate is bad in law - Chief Metropolitan Magistrate was wrong in proceeding to issue summons vide the impugned order merely on the existence of preponderance of probability - Petitioner is a young girl of 26 years with a very bright future ahead and who while studying law is also keeping her aspirations flying high through shooting and bringing laurels for the Country, this Court is of the considered opinion that she ought not to be punished for the alleged acts of her father solely on the pretext of her License being used by him - Present petition is allowed and the Criminal Complaint No.14924/2018 filed by the DRIis quashed against the petitioner hereinand all the other proceedings emanating from the said complaint also stand quashed qua the petitioner - Petition allowed: High Court [para 9, 10, 11, 12, 13, 17, 20, 22, 24, 25]
- Petition allowed: DELHI HIGH COURT |
|
